Venezuela strokes six zeros from its currency, Bolivar loses the ground compared to the dollar - economy

The central bank of Venezuela carried out the announced changeover plan for the National Fiat currency Bolivar on October 1. According to earlier statements, this change meant to delete six zeros from the currency in order to facilitate payments and currency processing. However, the Bolivar lost more than 20 % of its value compared to the US dollar just a few hours after using this measure.

Venezuela strokes six zeros from its currency

The central bank of Venezuela, which dictates the country's monetary policy, has made a change in its Fiat currency, the Bolivar, to simplify payment and handling of large amounts of money. This change meant that the current value of the currency was shortened by six zeros, so that 1,000,000 Bolivare are now only 1 Bolivar.

The measure was announced in August, as the central bank announced, the name of the currency in "digital Bolivar ”to change, which triggered speculation about a possible edition of a digital central bank currency in the country. In this regard, however, the bank did not submit any reports and instead announced the issue of new changes to supplement the conversion plan.

But also with this measure, the so -called digital bolivar still loses value rapidly. According to one of the most popular dollar price pages in Venezuela, Monitor Dolar Paralelo, the exchange rate of 4.317.970,70 Bolivare per dollar to 5.140,000 (or 5,14 in the modified currency) in just two days. This means that the Fiat currency on the sidelines of the changeover plan lost 19% of its value.

Some analysts have reported that the government will probably start the foreign exchange market by injecting resources to keep the exchange rate low at short notice. Tomás Socías López, a Venezuelan analyst, Local media could be explained by the government Foreign market Liquidity of up to $ 30 million a week, with the aim of keeping this course artificially low.